If the stock market is witnessing a rapid boom, there is also a rapid decline. Due to this reason, there has been a huge decline in the stock of many companies as well as a jump. But on the contrary, ITC’s stock has jumped sharply, with its share price reaching a three-year high. Which means investors can get huge returns.
Shares of ITC Ltd continued to rise in the opening session of Monday with the stock rising to a 3-year high. Its shares rose 2.51% to Rs 291.50 on BSE, the highest price since 2019. Its shares have outperformed in 2022 (YTD), after a sluggish performance over the past few years. While the Sensex has lost around 11% during this period, it has jumped over 32 per cent.
How much growth in which business?
ITC is involved in industries such as FMCG, Hotels, Packaging, Paperboard, Specialty Paper and Agribusiness. FMCG reported a 12% increase in net profit to Rs 4,195 crore for the January-March period as against Rs 3,755 crore a year ago. The Kolkata-based company’s revenue from operations grew 15% to ₹17,754 crore as against ₹15,404 crore in the previous year period.
35.3% higher profit in hotel business
Its FMCG revenue grew 12.3% to Rs 4,141.9 crore during the quarter, while cigarette revenue grew 10 per cent to Rs 6,443. The hotel business has earned Rs 389.6 crore during the quarter, which is 35.3% higher than a year ago.
Better than expected improvement in demand
In a report released in mid-June, Motilal Oswal had said that after the second wave of COVID, with demand reaching pre-pandemic levels, it has upgraded ITC shares to buy advice. He had said in a report that there is a better than expected improvement in demand and there is a possibility of good margins in cigarettes.
Hoping to continue boom
Along with this, he also said that with the outlook, good sales in FMCG business and better capital allocation in recent years, its ITC shares will remain positive. Analysts expect this trend to continue and result in improved cigarette volumes and earnings visibility in the medium term.